Amazon FBA vs. Walmart WFS Returns: The Real Cost of Return Handling

The Hidden Truth About Returns

If you sell on Amazon FBA or Walmart Fulfillment Services (WFS), you’re paying for a full reverse-logistics machine:

• Customer support + refund operations
• Return label + carrier movement
• Warehouse receiving + inspection + grading
• Restock (or liquidation/disposal/return-to-seller workflows)
• Downstream “fee math” (what gets refunded vs. kept)

The result: two ASINs (or Walmart Item IDs) with the same sales volume can have wildly different profitability depending on return rate, return reasons, item condition at return, and category rules. This post breaks down the most important return-related fees and policies for both platforms—using the most current guidance available.

Part 1: Amazon FBA Return Handling Fees (What You Actually Pay)

1) Amazon’s “Returns Processing Fee” (Two Different Concepts)

Amazon return costs show up in two main ways:

A) Returns processing fee for Apparel & Shoes Amazon explicitly applies a returns processing fee for apparel and shoes on customer returns. This is separate from the “high return rate” program below.

B) Returns processing fee for High Return Rate products (non-apparel/shoes) Amazon also charges a returns processing fee on products (excluding apparel and shoes) when your product’s return rate is considered high relative to its category threshold. This was rolled out as part of the returns-focused fee updates that took effect June 1, 2024, and is assessed after the close of the return-rate measurement window.

• Important Rule: Amazon states that returns above a stated volume threshold (e.g., returns exceeding 100 units across the shipment month + the following two months) can trigger the returns processing fee.

Practical takeaway: On Amazon, return fees aren’t only about the return itself—they can scale with return rate and category thresholds, and they can show up later after the measurement window closes.

2) The “Fees You Don’t Get Back” Problem

Even when Amazon refunds the customer, sellers often feel the real pain from fees that are not fully reversed (or are only partially reversed depending on the scenario/category). This is why high-return niches can look “great” in sales—but bleed cash in net.

What to watch for in your own account:

• Whether the fulfillment fee is reimbursed or retained in a specific return scenario.
• Whether any referral fee is returned.
• Whether you’re charged a returns processing fee (apparel/shoes or high-return-rate triggers).

Because Amazon’s exact behavior can vary by program and scenario, the safest operational approach is:

1. Build a per-ASIN return cost assumption.
2. Monitor it monthly.
3. Treat “return rate” like a first-class KPI (right next to TACoS/ACoS).

3) Removal, Disposal, and Unsellable Inventory Costs

Returns don’t always come back sellable. Some items become:

• Customer damaged
• Warehouse damaged
• Unfulfillable (missing parts, packaging destroyed, hygiene reasons, etc.)

At that point, your options often become:

• Removal order: Ship back to you.
• Disposal: Amazon destroys it.
• Liquidation: If eligible.

Even if your returns processing fee is low, removal/disposal can become the profit killer—especially for low ASP items.

Part 2: Walmart WFS Return Handling Fees (Clear, Weight-Based, and Very Real)

Walmart’s WFS documentation is more direct about return processing costs.

1) WFS Return Processing Fee (Return Shipping Fee) — Weight-Based

Walmart states the return processing fee is based on shipping weight (the greater of unit weight and dimensional weight), and additional fees can apply for apparel, hazardous materials, and oversize items.

Standard return fees per unit listed by Walmart:

• ≤ 1 lb: $4.70
• 2 lb: $6.20
• 3 lb: $6.70
• 4–20 lb: $7.00 + $0.40 per lb over 4 lb
• 21–30 lb: $15.55 + $0.40 per lb over 21 lb
• 31–50 lb: $14.55 + $0.40 per lb over 31 lb
• ≥ 51 lb: $17.55 + $0.40 per lb over 51 lb
• Big & Bulky: $155 + $0.80 per lb over 90 lb

Practical takeaway: On WFS, returns are not “random.” You can model them with shipping weight and expected return rate.

2) When Walmart Waives the Return Processing Fee

Walmart states it will waive the return processing fee for returns identified as Walmart at fault.

• Examples include: Lost in transit, lost after delivery, unable to deliver, item damaged, shipping box damaged, arrived late, wrong item received.

For returns not identified as Walmart’s fault (wrong size/fit, poor quality, missing parts, not as described, changed mind, etc.), the seller pays the return processing fee.

3) WFS Return Exceptions: The “Fee Math” You Need to Understand

Walmart spells out how credits/charges can work depending on who is at fault and whether the item is sellable on return.

• Walmart at fault: You may be credited the original sales price, while Walmart retains fulfillment and referral fees in some scenarios.
• Sellable returns: If the returned item is sellable, Walmart may restock it, and the accounting can reverse the sale differently than if it’s unsellable.
• Seller at fault: Walmart indicates you pay the return processing fee, and the sale reversal/credits follow the WFS rules (including Walmart retaining certain fees).

Practical takeaway: The “return reason” matters. It changes who pays, what gets reversed, and whether additional fees show up.

4) WFS Disposal & Removal Fees (When Returns Go Unsellable)

Walmart also publishes disposal and removal fees (these can apply when inventory is unsellable or based on your return preferences):

• Disposal fee (≤ 2 lb): $0.35
• Disposal fee (3–500 lb): $0.35 + $0.20 per lb over 2 lb
• Removal fee: Disposal fee + $0.40 per lb shipping cost

Amazon FBA vs. Walmart WFS Returns: What Sellers Should Track Weekly

If you want returns to stop silently crushing margins, track these like a dashboard:

1. Return rate (by SKU/ASIN/Item ID)
   
   • Total shipped units vs. returned units.
   • Return reasons (fit, defective, not as described, damaged, changed mind).
2. Cost per return (blended)
   
   • Include: Returns processing fees (where applicable), lost fulfillment fees / retained fees, removal/disposal costs, and inventory loss (unsellable rate).
3. “Return-proofing” product listing + operations
   
   • High leverage fixes: Better images (scale, sizing, included accessories clearly shown), stronger bullets (compatibility, what’s included, what’s not included), packaging improvements (reduce damage + missing parts), and QA spot checks on inbound inventory.

Fast Ways to Reduce Returns (That Actually Work)

Here’s what reliably lowers return rates on both Amazon and Walmart:

• Kill ambiguity on the listing: Add “What’s included” and “Common compatibility notes.”
• Add a short “Before you buy” section in images.
• Reduce “not as described” triggers: Don’t overpromise; match color/finish expectations (especially for textiles and home goods).
• Fix sizing and fit issues: Size charts, fit notes, comparison images. (If you sell apparel, assume returns and price accordingly).
• Make packaging survivable: Packaging is return prevention. Less damage = fewer “arrived damaged” claims.

Bottom Line

Amazon FBA return costs often show up as a mix of returns processing fees (apparel/shoes and high-return-rate triggers), plus the indirect pain of fees not fully reversed and inventory that comes back unsellable.

Walmart WFS returns are more explicitly modeled: a published weight-based return processing fee, clear exceptions (Walmart-at-fault vs. seller-at-fault), and published disposal/removal fees.